Archives for consumption

We have just released a series of five one-hour Freakonomics Radio specials to public-radio stations across the country (check here to find your local station), and now they’re hitting our podcast stream as well. If you are a dedicated podcast subscriber, then some of this material will be familiar to you. These new shows are what might best be called “mashupdates” — that is, mashups of earlier podcasts that have also been updated with new interviews, etc.

Today’s episode is called “Show and Yell” (download/subscribe at iTunes, get the RSS feed, listen via the media player above, or read the transcript below).
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Now, Lindstrom, returns with his answers to a few of them. As always thanks for every one who participated.

Q One more question occurred to me: Marketing is intended to persuade us to buy products, but it also serves another latent function which is to educate us about new products, about differences between products, or about the products themselves. Given this educational benefit, among other benefits, do you think marketing is a net good or a net bad for society on the whole? - NZRead More »

Though the exact percentage is debatable, the fact is that the vast majority of U.S. GDP is made up of personal consumption. The American consumer doesn’t just drive the U.S. economy, for decades he’s been driving the global one as well. Though that dynamic is slowly changing as Americans cut back on just about everything we buy, for the better part of the last 60 years, the U.S. consumer has been king. And from this has sprung a massive marketing and advertising industry coldly focused on a singular goal: getting us to buy as much stuff as they possibly can.

Yesterday we learned that 15.1% of Americans were living in poverty in 2010, the highest level since 1993, and up nearly 1 percentage point from 2009, when it was 14.3%. That data is based on an income measurement which shows that in 2010, 46.2 million Americans were living below the poverty line, defined as $22,314 a year for a family of four.

But income is just one way to measure poverty, and a particularly tricky (and narrow) way at that – so says Notre Dame economist and National Poverty Center research affiliate, James Sullivan, who believes that to measure poverty strictly by income fails to accurately reflect people’s true economic circumstances. Income alone ignores the effects of things like the Earned Income Tax Credit, Medicaid, food stamps, and housing subsidies. From a Notre Dame press release on Sullivan’s recent poverty research:

“Income received from food stamps, for example, grew by more than $14 billion in 2009. By excluding these benefits in measuring poverty, the Census figures fail to recognize that the food stamps program lifts many people out of actual poverty,” Sullivan says. “If these programs are cut back in the future, actual poverty will rise even more.”

Conspicuous consumption has hardly gone away — what do you think bling is? — but now it’s got a right-minded cousin: conspicuous conservation. Whereas conspicuous consumption is meant to signal how much green you’ve got, conspicuous conservation signals how green you are. Like carrying that “I’m not a plastic bag” bag, or installing solar panels on the side of your house facing the street — even if that happens to be the shady side.

Conspicuous conservation is the theme of our latest podcast, called “Hey Baby, Is That a Prius You’re Driving?” (You can download/subscribe at iTunes, get the RSS feed, listen live via the embedded media player, or read the transcript here.) It centers around a paper by Alison and Steve Sexton, a pair of Ph.D. economics candidates (who happen to be twins, and who happen to have economist parents), called “Conspicuous Conservation: The Prius Effect and Willingness to Pay for Environmental Bona Fides.” Why single out the Toyota Prius?
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Last year, Notre Dame economist William Evans, along with Timothy Moore from the University of Maryland, documented that mortality rates spike by almost one percent on the first day of every month, remain high for the next few days, and then steadily decline over the course of the month. Now they think they’ve figured out one reason why: our paychecks are killing us.

In a study to be published in an upcoming issue of the Journal of Public Economics, Evans and Moore examined the death records of four demographic groups in the U.S.: seniors on Social Security; military personnel; families receiving tax rebate checks in 2001; and recipients of Alaska’s Permanent Fund dividends. Their results show that mortality increased the week after checks arrived for each of these groups.
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If you’ve ever bought alcohol in Pennsylvania, you know what a weird, controlled system it has. As 1 of 19 “alcoholic beverage control” states in the U.S., Pennsylvania has some of the more strict, if not bizarre, laws regulating the retail sales of booze. Wine and spirits are sold only by state-owned stores, which don’t even have names; they’re designated by call numbers instead. Prices are kept uniform in all locations. Many of the stores operate at a loss. If you’re under 21, you’re not even allowed inside, and until recently, you couldn’t buy alcohol on a Sunday. Oh, and check out its “Kafka-esque” system of grocery store wine vending machines.